THE ROAD TRANSPORT CORPORATIONS ACT, 1950 

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ARRANGEMENT OF SECTIONS 

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CHAPTER I 

PRELIMINARY 

SECTIONS 

1. Short title, extent and commencement. 

2. Definitions. 

CHAPTER II 

ROAD TRANSPORT CORPORATIONS 

3. Establishment of Road Transport Corporations in the States. 

4. Incorporation. 

5. Management of Corporation and Board of Directors. 

6. Disqualifications for being chosen as, or for being, a Director of a Corporation. 

7. Resignation of office by the Chairman or a Director. 

8. Removal of Chairman and members from office. 

9. Vacancies amongst members or defect in the constitution not to invalidate acts or proceedings of a 

Corporation. 

10. Temporary association of persons with a Board for particular purposes. 

11. Meetings of Boards. 

12. Power to appoint committees and delegate functions. 

13. Authentication of orders and other instruments. 

14. Officers and servants of the Corporation. 

15. Managing Director, Chief Accounts Officer and Financial Adviser. 

16. General disqualification of all officers and servants. 

17. Appointment of Advisory Council. 

CHAPTER IIA 

SUBSIDIARY CORPORATIONS 

17A. Establishment of subsidiary corporations. 

CHAPTER III 

POWERS AND DUTIES OF CORPORATION 

18. General duty of Corporation. 

19. Powers of Corporation. 

19A. Disposal of unclaimed articles and property. 

19B. Corporation to obtain the approval of the Central Government in certain cases. 

20. Extension of the operation of the road transport service of a Corporation to areas within another 

State. 

21. Carriage of mails. 

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CHAPTER IV 

FINANCE, ACCOUNTS AND AUDIT 

SECTIONS 

22. General principle of Corporation’s finance. 

23. Capital of the Corporation. 

24. Additional capital of the Corporation. 

25. Guarantee by the State Government. 

26. Borrowing powers. 

27. Fund of the Corporation. 

28. Payment of interest and dividend. 

29. Provision for depreciation and reserve and other funds. 

30. Disposal of net profits. 

31. Power of the Corporation to spend. 

32. Budget. 

33. Accounts and audit. 

CHAPTER V 

MISCELLANEOUS 

34. Directions by the State Government. 

35. Returns and reports. 

36. Power to order inquiries. 

37. Power to control a part of the undertaking of a Corporation. 

38. Power to supersede a Corporation. 

39. Liquidation of a Corporation. 

40. Compensation for acquisition of road transport undertakings. 

41. Omitted 

42. Power of entry. 

43. Directors, Officers and other employees of a Corporation to be public servants. 

44. Power to make rules. 

45. Power to make regulations. 

45A. Every rule and regulation to be laid before State Legislature. 

46. Penalty for breach of rules. 

47. Special provisions relating to Bombay. 

47A. Special provision for reconstitution or dissolution of certain Corporations. 

48. Transitional provision relating to Bombay State Road Transport Corporation. 

SPECIAL PROVISIONS APPLICABLE TO THE UNION TERRITORY OF DELHI 

CHAPTER VI 

49. Prosecution and cognizance of offences. 

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SECTIONS 

50. Appointment of Magistrates. 

51. Composition of offences. 

52. Limitation of time for prosecution. 

53. Power of magistrate to hear cases in absence of accused when summoned to appear. 

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THE ROAD TRANSPORT CORPORATIONS ACT, 1950 

ACT NO. 64 OF 1950  

[4th December, 1950.] 

An Act to provide for the incorporation and regulation of Road Transport Corporations. 

BE it enacted by Parliament as follows:— 

CHAPTER I 

PRELIMINARY 

1.  Short  title,  extent  and  commencement.—(1)  This  Act  may  be  called  the  Road  Transport 

Corporations Act, 1950. 

(2) It extends to the whole of India 1***: 

2[Provided  that  on  and  from  the  commencement  of  the  Delhi  Road  Transport  Laws  (Amendment) 
Act, 1971, this Act, as amended by the said Act, shall extend to, and be in force in, the Union territory of 
Delhi:] 

3[Provided  further  that  on  and  from  the  commencement  of  the  Road  Transport  Corporations 
(Amendment)  Act,  1982,  this  Act,  as  amended  by  the  said  Act,  shall  extend  to  the  Union  territory  of 
Mizoram.] 

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2. Definitions.—In this Act, unless the context otherwise requires,— 

(a)  “ancillary  service”  means  any  subsidiary  service  which  provides  amenities  or  facilities  to 

persons making use of any road transport service of a Corporation; 

5[(aa) “Board” means the Board of Directors of a Corporation;] 

(b) “Corporation” means a Road Transport Corporation established under section 3; 

5[(bb) “Director” means a member of the Board;] 

(c) “extended area” means any area or route to which the operation of any road transport service 

of a Corporation has been extended in the manner provided in section 20; 

(d) “prescribed” means prescribed by rules made under this Act;  

(e)  “road  transport  service”  means  a  service  carrying  passengers  or  goods  or  both  by  road  in 

vehicles for hire or reward; 

(f)  “vehicle”  means  any  mechanically  propelled  vehicle,  used  or  capable  of  being  used  for  the 

purpose of road transport, and includes a tram-car, a trolly-vehicle and a trailer; 

(g)  words  and  expressions  used  but  not  defined  in  this  Act  and  defined  in  the  Motor  Vehicles    

Act, 1939 (4 of 1939), have the meaning assigned to them in that Act; 

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1. The words “except the Union territory of Delhi” omitted by Act 71 of 1971, s. 2 (w.e.f. 3-9-1971).  
2. The proviso added by s. 2, ibid. (w.e.f. 3-11-1971).  
3. Ins. by Act 63 of 1982, s. 2 (w.e.f. 13-11-1982).  
4. Omitted by Act 71 of 1971, s. 7(a) and the First Schedule (w.e.f. 3-11-1971).  
5. Ins. by Act 63 of 1982, s. 16 and the Schedule (w.e.f. 13-11-1982).  
6. Omitted by A.O. (No. 3), 1956.  

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CHAPTER II 

ROAD TRANSPORT CORPORATIONS 

3. Establishment of Road Transport Corporations in the States.—The State Government having 

regard to— 

(a) the advantages offered to the public, trade and industry by the development of road transport; 

(b) the desirability of co-ordinating any form of road transport with any other form of transport; 

(c) the desirability of extending and improving the facilities for road transport in any area and of 

providing an efficient and economical system of road transport service therein, 

may, by notification in the Official Gazette, establish a Road Transport Corporation for 1[the whole or any 
part of the Union territory of Delhi] under such name as may be specified in the notification. 

4. Incorporation.—Every Corporation shall be a body corporate by the name notified under section 3 

having perpetual succession and a common seal, and shall by the said name sue and be sued. 

2[5.  Management  of  Corporation  and  Board  of  Directors.—(1)  The  general  superintendence, 
direction and management of the affairs and business of a Corporation shall vest in a Board of Directors 
which, with the assistance of its committees and Managing Director, may exercise all such powers and do 
all such acts and things as may be exercised or done by the Corporation. 

(2) The Board shall consist of a Chairman and such other Directors, being not less than five and not 

more than seventeen, as the State Government may think fit to appoint. 

(3)  The  State  Government  may,  if  it  so  thinks  fit  appoint  one  of  the  other  Directors  as  the                       

Vice-Chairman of the Board. 

(4) Rules made under this Act shall provide for the representation, both of the Central Government 
and of the State Government concerned, on the Board in such proportion as may be agreed to by both the 
Government  and  of  appointment  by  each  Government  of its own  representatives  thereto  and  where  the 
capital  of  a  Corporation  is  raised  by  the  issue  of  shares  to  other  parties  under  sub-section  (3)  of                
section 23, provision shall also be made for the representation of such shareholders on the Board and the 
manner in which the representatives shall be elected by such shareholders. 

(5) The term of office of and the manner of filling casual vacancies among the Directors shall be such 

as may be prescribed.] 

6. Disqualifications for being chosen as, or for being, a  3[Director of a Corporation].—4[(1)] A 

person shall be disqualified for being chosen as, or for being, a 3[Director of a Corporation]— 

(a) if he is found to be a lunatic or a person of unsound mind; or 

(b) if he has been adjudged insolvent; or 

(c) if he has been convicted of an offence involving moral turpitude; or 

(d) if he has, directly or indirectly, any interest in any subsisting contract made with, or in any 
work  being  done  for,  the  Corporation  except  as  a  shareholder  (other  than  a  director)  in  an 
incorporated  company,  provided  that  where  he  is  a  shareholder  he  shall  disclose  to  the  State 
Government the nature and extent of shares held by him in such company; or 

(e) if he has any financial interest in any other road transport undertaking. 

1. Subs. by Act 71 of 1971, s. 7(a) and the First Schedule, for “the whole or any part of the State” (w.e.f. 3-9-1971).  
2. Subs. by Act 63 of 1982, s. 3, for section 5 (w.e.f. 13-11-1982).  
3. Subs. by s. 4, ibid., for “member of a Corporation” (w.e.f. 13-11-1982).  
4. Section 6 re-numbered as sub-section (1) thereof by Act 28 of 1959, s. 2 (w.e.f. 1-9-1959).  

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1[(2) Nothing in clause (d) of sub-section (1) shall be deemed to disqualify the 2[Managing Director] 

of a Corporation for being chosen as, or for being, a 3[Director] thereof.] 

4[(3) Nothing in clause (e) of sub-section (1) shall be deemed to disqualify,— 

(a) any officer or other employee of the Government for being chosen as, or for being, a Director 

of a Corporation; 

(b) any officer or other employee of a Corporation for being chosen as, or for being, a Director of 

another Corporation.] 

7. Resignation of office by the Chairman or a 5[Director].—The Chairman or any other 5[Director] 
of a Corporation may resign his office by giving notice in writing to the State Government and, on such 
resignation being accepted by that Government, shall be deemed to have vacated his office. 

8.  Removal  of  Chairman  and  members  from  office.—6[(1)]  The  State  Government  may  remove 

from office the Chairman or any other 7[Director] of the Corporation who— 

(a) is or becomes subject to any of the disqualifications mentioned in section 6; or 

(b) without excuse sufficient in the opinion of the State Government is absent for more than four 

consecutive meetings of the 8[Board]. 

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10[(2) The State Government may terminate the appointment of any Director after giving him notice 

for such period (being not less than one month) as may be prescribed: 

Provided  that  the  appointment  of  a  Director  appointed  by  the  Central  Government  shall  not  be 

terminated under this sub-section without the concurrence of that Government.] 

9.  Vacancies  amongst  members  or  defect  in  the  constitution  not  to  invalidate  acts  or 
proceedings of a Corporation.—No act or proceeding of a  11[Corporation or its Board] shall be invalid 
by reason only of the existence of any vacancy 12[in its Board] or any defect in the constitution thereof. 

10. Temporary association of persons with a 13[Board] for particular purposes.—(1) A 13[Board] 
may associate with itself for any particular purpose in such manner as may be determined by regulations 
made under this Act any person whose assistance or advice it may desire. 

(2) A person associated with it by the  13[Board] under sub-section (1) for any purpose shall have a 
right to take, part in the discussions of the 13[Board] relevant to that purpose, but shall not have a right to 
vote at a meeting of the 13[Board]. 

11. Meetings of 14[Board].—(1) A 14[Board] shall meet at such times and places and shall, subject to 
the  provisions  of  sub-sections  (2)  and  (3),  observe  such  rules  of  procedure  in  regard  to  transaction  of 
business at its meetings as may be provided by regulations made under this Act: 

Provided that the 14[Board] shall meet at least once in every three months. 

1. Ins. by Act 28 of 1959, s. 2 (w.e.f. 1-9-1959).  
2. Subs. by Act 63 of 1982, s. 4, for “Chief Executive Officer or General Manager” (w.e.f. 13-11-1982).  
3. Subs. by s. 4, ibid., for “member” (w.e.f. 13-11-1982).  
4. Ins. by s. 4, ibid. (w.e.f. 13-11-1982).  
5. Subs. by s. 16 and the Schedule, ibid., for “member” (w.e.f. 13-11-1982).   
6. Section 8 re-numbered as sub-section (1) thereof by s. 5, ibid. (w.e.f 13-11-1982)  
7. Subs. by s. 5, ibid., for “member” (w.e.f. 13-11-1982).  
8. Subs. by s. 5, ibid., for “Corporation” (w.e.f. 13-11-1982).  
9. Omitted by Act 71 of 1971, s. 7(a) and the First Schedule (w.e.f. 3-9-1971).  
10. Ins. by Act 63 of 1982, s. 5 (w.e.f. 13-11-1982).  
11. Subs. by s. 16 and the Schedule, ibid., for “Corporation” (w.e.f. 13-11-1982).  
12. Subs. by s. 16 and the Schedule, ibid., for “amongst its members” (w.e.f. 13-11-1982).  
13. Subs. by s. 16 and the Schedule, ibid., for “Corporation” (w.e.f. 13-11-1982).  
14. Subs. by s. 16 and the Schedule, ibid., for “Corporation” (w.e.f. 13-11-1982). 

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(2)  The  person  to  preside  at  a  meeting  of  a  1[Board]  shall  be  the  Chairman  thereof,  or  in  his                

absence  from  any  meeting,  the Vice-Chairman,  if  any,  or  in the  absence  of  both  the  Chairman  and  the 
Vice-Chairman,  2[such  Director  as  may  be  chosen  by the  Directors  present]  from  among  themselves  to 
preside. 

(3) All questions at a meeting of a  1[Board] shall be decided by a majority of votes of the members 
present, and in the case of equality of votes, the Chairman or, in his absence, any other person presiding 
shall have a second or casting vote. 

12.  Power  to  appoint  committees  and  delegate  functions.—3[(1)]  A 4[Board]  may,  from  time  to 

time by resolution passed at a meeting— 

(a)  appoint  committees 5[consisting  of  Directors]  for  performing  such  functions  as  may  be 

specified in the resolution; 

(b)  delegate  to  any  such  committee  or  to  the  6[Chairman,  Vice-Chairman,  Chief  Executive 
Officer,  the  General  Manager,  the  Deputy  General  Manager  or  the  Chief  Accounts  Officer  of  the 
Corporation] subject to such conditions and limitations, if any, as may be specified in the resolution, 
such of its powers and duties as it may think fit; 

(c) authorised the 7[Managing Director] 8[or any other officer of the Corporation] subject to such 
such conditions and limitations, if any, as may be specified in the resolution to exercise such powers 
and perform such duties as it may deem necessary for the efficient day-to-day administration of its 
business. 

9[(2) The Chairman, Vice-Chairman or Managing Director may delegate any of his powers and duties 
duties [including powers and duties delegated to him under sub-section (1)] to any officer of the Corpo-
ration,  and the  officer to  whom  such  powers  and  duties  are  delegated,  shall  exercise  and  perform  such 
powers and duties under the control and supervision of the Managing Director.] 

10[13.  Authentication  of  orders  and  other  instruments.—All  orders  and  decisions  of  the  Board 
shall be authenticated by the signature of the Secretary or by any such other officer of the Corporation as 
may be authorised in this behalf by the Board or under the regulations made under section 45 and all other 
instruments issued  by  a  Board shall be authenticated  by  the  signature of the Managing  Director  or  any 
other officer of the Corporation authorised in like manner in this behalf.] 

14.  Officers  and  servants  of  the  Corporation.—11[(1)  Every  Corporation  shall  have  a  Managing 

Director, a Chief Accounts Officer and a Financial Adviser, appointed by the State Government: 

Provided  that  the  same  person  may  be  appointed  as  the  Chief  Accounts  Officer  and  the  Financial 

Adviser.]  

(2) A Corporation may appoint 12[a Secretary and such other officers and employees] as it considers 

necessary for the efficient performance of its functions. 

1. Subs. by Act 63 of 1982, s. 16 and the Schedule, for “Corporation” (w.e.f. 13-11-1982). 
2. Subs. by s. 16 and the Schedule, ibid., for “such member as may be chosen by the members present” (w.e.f. 13-11-1982).  

1982).  

3. Section 12 renumbered as sub-section (1) thereof by s. 6, ibid. (w.e.f 13-11-1982). 
4. Subs. by s. 6, ibid., for “Corporation” (w.e.f. 13-11-1982). 
5. Subs. by s. 6, ibid., for “of its members” (w.e.f. 13-11-1982).   
6. Subs. by Act 71 of 1971, s. 7(a) and the First Schedule, for “Chairman or Vice-Chairman” (w.e.f. 3-9-1971).  
7. Subs. by Act 63 of 1982, s. 6, for “Chief Executive Officer or General Manager” (w.e.f. 13-11-1982).   
8. Ins. by Act 28 of 1959, s. 3 (w.e.f. 1-9-1959)  
9. Ins. by Act 63 of 1982, s. 6 (w.e.f. 13-11-1982).  
10. Subs. by s. 7, ibid., for s. 13 (w.e.f. 13-11-1982). 
11. Subs. by s. 8, ibid., for sub-section (1) (w.e.f. 13-11-1982).  
12. Subs. by s. 8, ibid., for “such other officers and servants” (w.e.f. 13-11-1982).  

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1[(3) The conditions of appointment and service and the scales of pay of the officers and employees of 

of a Corporation shall— 

(a) as respects the Managing Director, the Chief Accounts Officer and the Financial Adviser, or, 
as  the  case  may  be,  the  Chief  Accounts  Officer-cum-Financial  Adviser,  be  such,  as  may  be 
prescribed, and 

(b)  as  respects  the  other  officers  and  employees,  be  such,  as  may,  subject  to  the  provisions  of 

section 34, be determined by regulations made under this Act.] 

2[15.  Managing  Director,  Chief  Accounts  Officer  and  Financial  Adviser.—(1)  The  Managing 
Director  shall  be  the  executive  head  of  the  Corporation  and  all  other  officers  and  employees  of  the 
Corporation shall be subordinate to him. 

(2)  The  Managing  Director  shall  obtain  the  views  of  the  Chief  Accounts  Officer  and  the  Financial 
Adviser  or,  as  the  case  may  be,  the  Chief  Accounts  Officer-cum-Financial  Adviser,  on  every  proposal 
involving  revenues,  or expenditure  from  the  fund,  of the  Corporation  and  shall cause such  views to  be 
placed before the Board prior to the consideration of such proposal by the Board.] 

16.  General  disqualification  of  all  officers  and  servants.—No  person  who  has  directly  or 
indirectly, by himself or his partner or agent, any share or interest in any contract, by or on behalf of a 
Corporation,  or  in  any  other  road  transport  undertaking  shall  become  or  remain  an  3[officer  or  other 
employee] of the Corporation. 

17. Appointment of Advisory Council.—The State Government may, after ascertaining the views of 
the  Corporation,  by  notification  in  the  Official  Gazette,  constitute  one  or  more  Advisory  Councils 
consisting of such number of persons, on such terms, and for the purpose of advising the Corporation on 
such matters, as may be specified in that notification. 

4[CHAPTER IIA 

SUBSIDIARY CORPORATIONS 

17A.  Establishment  of  subsidiary  corporations.—(1)  Where  a  Corporation  (hereinafter  in  this 
section referred to as the parent Corporation) is satisfied that it is expedient or necessary so to do for the 
more  efficient  discharge  of  its  functions  under  this  Act,  it  may,  with  the  concurrence  of  the  State                  
Government  and  the  Central  Government,  frame  by  notification  in  the  Official  Gazette  a  scheme  or 
schemes providing for the establishment of one or more subsidiary corporations. 

(2)  A  scheme  framed  under  sub-section  (1)  shall  specify  the  subsidiary  corporation  or  corporations 
which  shall  become  established  thereunder,  the  date  or  dates  with  effect  from  which  they  shall  be  so 
established,  the  powers  and  functions  of  the  parent  Corporation  which  such  subsidiary  corporation  or 
corporations  may  exercise  and  discharge,  the  conditions  and  limitations  subject  to  which  such  powers 
may  be  exercised,  the  management  of  the  affairs  of  each  such  subsidiary  corporation  by  a  Board  of 
Directors, the capital of each such subsidiary corporation and all other matters relating to such subsidiary 
corporations corresponding to the various matters for which provisions have been made in this Act with 
respect to the parent Corporation: 

Provided that— 

(a) no subsidiary corporation shall start operation on any new route without the previous approval 

of the parent Corporation; 

(b)  the  representatives  of  the  Central  Government  on  the  Board  of  Directors  of  a  subsidiary 

corporation shall be in proportion to its contribution to the capital of the parent Corporation; 

1. Subs. by Act 63 of 1982, s. 8, for sub-section (3) (w.e.f. 13-11-1982).  
2. Subs. by s. 9, ibid., for section 15 (w.e.f. 13-11-1982).  
3. Subs. by s. 16 and the Schedule, ibid., for “officer or servant” (w.e.f. 13-11-1982).  
4. Ins. by s. 10, ibid. (w.e.f. 13-11-1982).  

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(c) the liability of the Central Government to provide contribution to the capital of the subsidiary 
corporation  or  to  the  parent  Corporation  shall  not  be increased  without  the  approval  of  the  Central 
Government; 

(d)  a  subsidiary  corporation  shall  have  a  Managing  Director,  a  Chief  Accounts  Officer  and  a 
Financial  Adviser  or  a  Chief  Accounts  Officer-cum-Financial  Adviser,  and  such  officers  shall  be 
appointed by the State Government; 

(e)  the  State  Government  and  the  parent  Corporation  shall  have  power  to  give  directions  to  a 
subsidiary corporation in respect of any matter, including directions relating to recruitment conditions 
of  service  and  training  of  the  employees  of  the  subsidiary  corporation,  wages  to  be  paid  to  such 
employees, reserves to be maintained by the subsidiary corporation; 

(f)  the  capital  budget,  the  revenue  budget  and  the  annual  development  plans  of  a  subsidiary 
corporation shall be submitted for approval to the parent Corporation and where such budget or plan 
involves any deficit, also to the State Government. 

(3) Every subsidiary corporation established under a scheme framed under sub-section (1) shall be a 
body corporate, by the name specified in the scheme having perpetual succession and a common seal and 
shall by the said name sue and be sued.] 

 CHAPTER III 

POWERS AND DUTIES OF CORPORATION 

18. General duty of Corporation.—It shall be the general duty of a Corporation so to exercise its 
powers  as  progressively  to  provide  or  secure  or  promote  the  provision  of,  an  efficient,  adequate, 
economical and properly co-ordinated system of road transport services in the  1[Union territory of Delhi 
or part thereof] for which it is established and in any extended area: 

Provided that nothing in this section shall be construed as imposing on a Corporation, either directly 
or  indirectly,  any  form  of  duty  or  liability  enforceable  by  proceedings  before  any  Court  or  Tribunal  to 
which it would not otherwise be subject. 

19.  Powers  of  Corporation.—(1)  Subject  to  the  provisions  of  this  Act,  a  Corporation  shall  have 

power— 

(a) to operate road transport services in the 2[Union territory of Delhi] and in any extended area; 

(b) to provide for any ancillary service; 

(c) to provide for its employees suitable conditions of service including fair wages, establishment 

of provident fund, living accommodation, places for rest and recreation and other amenities; 

3[(d) to authorise the issue of passes to its employees and other  persons either free of cost or at 

concessional rates and on such conditions as it may deem fit to impose; 

(e) to authorise the grant of refund in respect of unused tickets and concessional passes.] 

(2)  Subject  to  the  provisions  of  this  Act,  the  powers  conferred  by  sub-section  (1)  shall  include 

power— 

(a) to manufacture, purchase, maintain and repair rolling stock, vehicles, appliances, plant, equip-
ment or any other thing required for the purpose of any of the activities of the Corporation referred to 
in sub-section (1); 

Explanation.—In this clause, the expression “manufacture” does not include the construction of 

the complete unit of a motor vehicle except for purposes of experiment or research; 

1. Subs. by Act 71 of 1971, s. 7(a) and the First Schedule, for “State or part of the State” (w.e.f. 3-9-1971).  
2. Subs. by s. 7(a) and the First Schedule, ibid., for “State” (w.e.f. 3-9-1971).  
3. Ins. by Act 28 of 1959, s. 4 (w.e.f. 1-9-1959)  

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(b)  to  acquire  and  hold  such  property,  both  movable  and  immovable,  as  the  Corporation  may 
deem necessary for the purpose of any of the  said activities, and to lease, sell or otherwise transfer 
any property held by it; 

(c) to prepare schemes for the acquisition of, and to acquire, either by agreement or compulsorily 
in accordance with the law of acquisition for the time being in force in the 1[Union territory of Delhi] 
and with such procedure as may be prescribed, whether absolutely or for any period, the whole or any 
part of any undertaking of any other person to the extent to which the activities thereof consist of the 
operation of road transport services in 2[that Union territory] or in any extended area; 

(d) to purchase by agreement or to take on lease or under any form of tenancy any land and to 

erect thereon such buildings as may be necessary for the purpose of carrying on its undertaking; 

(e)  to  authorise  the  disposal  of  scrap  vehicles,  old  tyres,  used  oils, 3[any  other  stores  of  scrap 

value, or such other stores as may be declared to be obsolete in the prescribed manner]. 

(f)  to  enter  into  and  perform  all  such  contracts  as  may  be  necessary  for  the  performance  of  its 

duties and the exercise of its powers under the Act; 

(g)  to  purchase  vehicles  of  such  type  as  may  be  suitable  for  use  in  the  road  transport  services 

operated by the Corporation; 

(h)  to  purchase  or  otherwise  secure  by  agreement  vehicles,  garages,  sheds,  office  buildings, 
depots,  land,  workshops,  equipment,  tools,  accessories  to and  spare  parts  for  vehicles, or  any  other 
article owned or possessed by the owner of any other undertaking for use thereof by the Corporation 
for the purposes of its undertaking; 

(i) to do anything for the purpose of advancing the skill of persons employed by the Corporation 
or  the  efficiency  of  the  equipment  of  the  Corporation  or  of  the  manner  in  which  that  equipment  is 
operated, including the provision by the Corporation, and the assistance by the Corporation to others 
for the provision of facilities or training, education and research; 

(j)  to  enter  into  and  carry  out  agreements  with  any  person  carrying  on  business  as  a  carrier  of 
passengers or goods providing for the carriage of passengers or goods on behalf of the Corporation by 
that other person at a thorough fare or freight. 

(k) to provide facilities for the consignment, storage and delivery of goods; 

(l) to enter into contracts for exhibition of posters and advertising boards on and in the vehicles 
and premises of the Corporation and also for advertisement on tickets and other forms issued by the 
Corporation to the public; 

(m) with the prior approval of the State Government to do all other things to facilitate the proper 

carrying on of the business of the Corporation. 

4[(n)  to  determine  with  the  previous  approval  of  the  State  Government,  and  in  case  of  a  road 
transport service operated in any extended area, also with the previous approval of the Government of 
the State within which such extended area is situated, fares and freights for the carriage of passengers 
and goods in any road transport service provided by the Corporation.] 

(3) Nothing in this section shall be construed as authorising a Corporation, except with the previous 

approval of the State Government— 

(i) to manufacture or maintain anything which is not required directly or indirectly for use for the 
purpose  of  the  undertaking  of  the  Corporation  or  to  repair,  store,  or  provide  any  service  for,  any 
vehicle which does not belong to the Corporation or is not used directly or indirectly for the purpose 
of its undertaking; 

1. Subs. by Act 71 of 1971, s. 7(a) and the First Schedule, for “State concerned” (w.e.f. 3-9-1971).  
2. Subs. by s. 7(a) and the First Schedule, ibid., for “that State” (w.e.f. 3-9-1971). 
3. Subs. by Act 63 of 1982, s. 11, for “or any other stores of scrap value” (w.e.f. 13-11-1982).  
4. Ins. by Act 71 of 1971, s. 7(a) and the First Schedule (w.e.f. 13-11-1971).  

10 

                                                           
(ii) to purchase any vehicle for the purpose of sale to another person; 

(iii)  to  sell  or  supply  to  any  person  lubricants,  spare  parts,  or  equipment  for  or  accessories  to, 

vehicles; 

(iv) to let vehicles on hire for the carriage of passengers or goods except as expressly provided by 

or under this Act. 

(4) Except as otherwise provided by this Act nothing in the foregoing provisions shall be construed as 

authorising the Corporation to disregard any law for the time being in force. 

(5) Where a Corporation acquires the whole or any part of an undertaking of any other person, the 
Corporation shall, in appointing its 1[officers and other employees] take into consideration the claims of 
employees employed in that undertaking. 

(6)  The  provisions  of  this  section  shall  not  be  construed  as  limiting  any  power  of  a  Corporation 

conferred by or under any subsequent provision of this Act. 

2[19A. Disposal of unclaimed articles and property.—(1) When any articles or goods have come 
into the possession of a Corporation for carriage or otherwise and are not claimed by the owner or any 
other person appearing to the Corporation to be entitled thereto, the Corporation shall, if such owner or 
other person is known, cause a notice to be served upon him requiring him to remove the articles or goods 
within seven days of the service of such notice. 

(2) If such owner or other person is not known or the notice cannot be served upon him or he does not 
comply with the requisition in the notice, the Corporation may, after the expiration of such period as may 
be specified by regulation made under this Act, sell the articles or goods by public auction and shall, after 
deducting from the sale-proceeds expenses for holding the sale or any amount which may be due to the 
Corporation,  credit  the  surplus  sale-proceeds,  if  any,  to  the  Fund  of  the  Corporation;  and  the                
sale-proceeds  so  credited  may  be  paid  on  demand  to  any  person  who  establishes  his  right  thereto  in  a 
court of competent jurisdiction or within one year of such sale to the satisfaction of the Corporation. 

19B.  Corporation  to  obtain  the  approval  of  the  Central  Government  in  certain  cases.—In  the 
exercise of any of its powers under this Act, the Corporation shall not incur on any single work, service or 
scheme or for any other purpose a capital expenditure of more than twenty-five lakhs of rupees except 
with the previous approval of the Central Government.] 

20.  Extension  of  the  operation  of  the  road  transport  service  of  a  Corporation  to  areas  within 
another  State.—(1)  If  a  Corporation  considers  it  to  be  expedient  in  the  public  interest  to  extend  the 
operation of any of its road transport services to any route or area situated within another State, it may, 
with the permission of the State Government, negotiate with the Government of the other State regarding 
the proposed extension. 

(2)  If  the  Government  of  the  other  State  approves  the  proposed  extension,  the  Corporation  shall 
prepare a scheme for the purpose and forward the same to the other Government for its consent, and after 
such  consent  has  been  received,  the  Corporation  may,  with  the  previous  approval  of  the  State 
Government, sanction the scheme. 

(3) After the scheme has been so sanctioned, it shall be competent for the Corporation to extend the 
operation of its road transport service to such route or area and when the operation of such service is so 
extended, the Corporation shall operate the service on that route or in that area subject to the provisions of 
any law in force in the other State within which such route or area is situated. 

(4)  The  Corporation  may,  from  time  to  time,  alter  or  extend  the  scheme  sanctioned  under                

sub-section  (2)  by  a  supplementary  scheme  prepared  and  sanctioned  in  the  manner  provided  in  the 
foregoing provisions of this section. 

1. Subs. by Act 63 of 1982, s. 11, for “officers and servants” (w.e.f. 13-11-1982).  
2. Ins. by Act 71 of 1971, s. 7(a) and the First Schedule (w.e.f. 3-9-1971).  

11 

                                                           
21.  Carriage  of  mails.—Notwithstanding  anything  contained 

in 

the  Motor  Vehicles                            

Act, 1939 (4 of 1939), a Corporation shall, if so required by the Central Government, carry mails at such 
rates and on such terms and conditions as may be specified in this behalf by 1[that Government]. 

CHAPTER IV 

FINANCE, ACCOUNTS AND AUDIT 

22. General principle of Corporation’s finance.—It shall be the general principle of a Corporation 

that in carrying on its undertaking it shall act on business principles. 

23.  Capital  of  the  Corporation.—2[(1)  The  State  Government  may  provide  to  a  Corporation 
established by that Government any capital that may be required by the Corporation for the purpose of 
carrying  on  its  undertaking  or  for  purposes  connected  therewith  on  such  terms  and  conditions,  not 
inconsistent with the provisions of this Act, as that Government may determine.] 

3[(2) The Corporation may, whether or not any capital is provided to it under sub-section (1), raise by 
the issue of shares such capital (hereafter in this section referred to as the  “authorised share capital”) as 
may be authorised in this behalf by the State Government: 

Provided that where any capital is provided to the Corporation under sub-section (1), no capital may 

be raised under this sub-section without the previous approval of the Central Government. 

(2A) Any capital raised under sub-section (2) with the previous approval of the Central Government 

may be,— 

(a) in addition to the capital provided to the Corporation under sub-section (1); 

(b)  subscribed  to  by  the  Central  Government  or  the  State  Government,  as  the  case  may  be,  by 
converting the whole or any part of the capital provided [whether before or after the commencement 
of the Road Transport Corporations (Amendment) Act, 1982] to the Corporation by that Government 
under sub-section (1).] 
(3) The 4[authorised share capital] of the Corporation shall be divided into such number of shares as 
the State Government may determine; and the number of shares which shall be subscribed by the State 
Government,  5***  and  other  parties  (including  persons  whose  undertakings  have  been  acquired  by  the 
Corporation) shall also be determined by the State Government 5***. 

(4)  The  allotment  of  shares  to  other  parties  mentioned  in  sub-section  (3)  shall  be  made  by  the 

Corporation in such manner as may be prescribed. 

(5) The shares of the Corporation shall not be transferable except in accordance with the rules made 

under this Act. 

(6) The Corporation may at any time, with the previous approval of the State Government, redeem the 

shares issued to the other parties under sub-section (4) in such manner as may be prescribed. 

24.  Additional  capital  of  the  Corporation.—If,  after  the  issue  of  shares  under  section  23  a 
Corporation  requires  any  further  capital,  the  Corporation  may,  with  the  previous  sanction  of  the  State 
Government, raise such additional capital by the issue of new shares and the provisions of sub-sections 
(2), 6[(2A)] (3), (4), (5) and (6) of the said section shall apply to the issue of such shares. 

25. Guarantee by the State Government.—The shares of a Corporation shall be guaranteed by the 
State  Government  as  to  the  payment  of  the  principal  and  the  payment  of  the  annual  dividend  at  such 
minimum rate as may be fixed by the State Government by notification published in the Official Gazette 
at the time of issuing the shares. 

1.  Subs.  by  Act  71  of  1971,  s.  7(a)  and  the  First  Schedule,  for  “The  Central  Government  in  consultation  with  the  State 

Government” (w.e.f. 13-11-1971). 

2. Subs. by s. 7 (a) and the First Schedule, ibid., for sub-section (1) (w.e.f. 13-11  
3. Subs. by Act 63 of 1982, s. 12, for sub-section (2) (w.e.f. 13-11-1982).  
4. Subs. by s. 12, ibid., for “authorised capital” (w.e.f. 13-11-1982).  
5. Omitted by Act 71 of 1971, s. 7(a) and the First Schedule (w.e.f. 3-9-1971).  
6. Ins. by Act 63 of 1982, s. 16 and the Schedule (w.e.f. 13-11-1982).  

12 

                                                           
1[26. Borrowing powers.—A Corporation may, with the previous approval of the State Government, 
borrow  money  for  the  purpose  of  raising  its  working  capital  or  meeting  any  expenditure  of  a  capital 
nature in the open market or from a corresponding new bank constituted under section 3 of the Banking 
Companies (Acquisition and Transfer of Undertakings) Act, 1970 (5 of 1970), or section 3 of the Banking 
Companies  (Acquisition  and  Transfer  of  Undertakings)  Act,  1980  (40  of  1980),  a  State  Finance 
Corporation, established under section 3 of the State Financial Corporations Act, 1951 (63 of 1951), the 
Industrial Finance Corporation of India, established under section 3 of the Industrial Finance Corporation 
Act,  1948  (15  of  1948),  the  Industrial  Development  Bank  of  India,  established  under  section  3  of  the 
Industrial Development Bank of India Act, 1964 (18 of 1964), the Life Insurance Corporation of India, 
established  under  section  3  of  the  Life  Insurance  Corporation  Act,  1956  (31  of  1956),  or  any  other 
financial institution providing credit which is subject to the control of the Reserve Bank of India.] 

27. Fund of the Corporation.—(1) Every Corporation shall have its own fund and all receipts of the 

Corporation shall be carried thereto and all payments by the Corporation shall be made therefrom. 

(2) Except as otherwise directed by the State Government, all moneys belonging to that fund shall be 
deposited  in  the  Reserve  Bank  of  India  or  with  the  agents  of  the  Reserve  Bank  of  India,  2[or  with  the 
corresponding  new  banks  constituted  under  section  3  of  the  Banking  Companies  (Acquisition  and 
Transfer of Undertakings) Act, 1970 (5 of 1970), or section 3 of the Banking Companies (Acquisition and 
Transfer of Undertakings) Act, 1980 (40 of 1980)] or invested in such securities as may be approved by 
the State Government. 

28.  Payment  of  interest  and  dividend.—(1)  Where  3[the  whole  or  part  of  the  capital  of  a 
Corporation] is provided by the Central Government and the State Government under sub-section (1) of 
section 23, the Corporation shall pay interest on such capital at such rate as may, from time to time, be 
fixed by the State Government  4*** and such interest shall be deemed to be a part of the expenditure of 
the Corporation. 

(2) Where the Corporation 5[raises the whole or any part of its capital] by issue of shares, it shall pay 
dividend on such shares at such rate as may, from time to time, be fixed by the Corporation, subject to 
any general limitations which may have been imposed by the State Government  4***, and such dividend 
shall be deemed to be a part of the expenditure of the Corporation. 

29. Provision for depreciation and reserve and other funds.—(1) A Corporation shall make such 
provisions for depreciation and for reserve and other funds as the State Government may, from time to 
time, direct. 

(2) The management of the said funds, the sums to be carried from time to time to the credit thereof 

and the application of the moneys comprised therein shall be determined by the Corporation: 

Provided  that  no  fund  shall  be  utilised  for  any  purpose  other  than  that  for  which  it  was  created 

without the previous approval of the State Government. 

30.  Disposal  of  net  profits.—After  making  provision  for  payment  of  interest  and  dividend  under 
section 28 and for depreciation, reserve and other funds under section 29, a Corporation may utilise such 
percentage  of  its  net  annual  profits  as  may  be  specified  in this  behalf by  the  State  Government  for  the 
provision of amenities to the passengers using the road transport services, welfare of labour employed by 
the  Corporation  and  for  such  other  purposes  as  may  be  prescribed  with  the  previous  approval  of  the 
Central  Government,  6[and  out  of  the  balance  such  amount  as  may,  with  the  previous  approval  of  the 
State Government  4***, be specified in this behalf by the Corporation, may be utilised for financing the 
expansion  programmes  of  the  Corporation  and  the  remainder,  if  any,  shall  be  made  over  to  the  State 
Government for the purpose of road development]. 

1. Subs. by Act 63 of 1982, s. 13, for section 26 (we.f. 13-11-1982).  
2. Ins. by s. 14, ibid. (w.e.f. 13-11-1982).  
3. Subs. by s. 16 and the Schedule, ibid., for “the capital of a Corporation” (w.e.f. 13-11-1982).  
4. Omitted by Act 71 of 1971, s. 7(a) and the First Schedule (w.e.f. 3-9-1971).  
5. Subs. by Act 63 of 1982, s. 16 and the Schedule, for “raises its capital” (w.e.f. 13-11-1982).   
6. Subs. by Act 28 of 1959, s. 6, for “and the balance shall be made over to the State Government  for the purpose of road 

development” (w.e.f. 1-9-1959).  

13 

                                                           
31. Power of the Corporation to spend.—A Corporation shall have power to spend such sums as it 
thinks fit on objects authorised under this Act and such sums shall be treated as expenditure payable out 
of the fund of the Corporation. 

32. Budget.—(1) Every Corporation shall, by such date in each year as may be prescribed, prepare 
and submit to the State Government for approval a budget for next financial year showing the estimated 
receipts and expenditure during that financial year in such form as may be prescribed. 

(2) Subject to the provisions of sub-sections (3) and (4), no sum shall be expended by or on behalf of 
a Corporation unless the expenditure of the same is covered by a current budget grant approved by the 
State Government. 

(3)  1[Subject  to  such  conditions  and  restrictions  as  may  be  specified  in  this  behalf  by  the  State 
Government,  a  Corporation  may  sanction]  any  re-appropriation  within  the  grant  from  one  head  of  the 
expenditure to another or from a provision made for one scheme to that in respect of another, subject to 
the condition that the aggregate budget grant is not exceeded. 

(4) A Corporation may, within such limits and subject to such conditions as may be prescribed, incur 
expenditure in excess of the limit provided in the budget approved by the State Government under any 
head of expenditure or in connection with any particular scheme. 

2[33.  Accounts  and  audit.—(1)  The  Corporation  shall  maintain  proper  accounts  and  other  records 
and prepare an annual statement of accounts including the profit and loss account and the balance sheet in 
such  form  as  may  be  prescribed  by  the  State  Government  in  consultation  with  the  Comptroller  and 
Auditor-General of India. 

(2) The accounts of a Corporation shall be audited annually by the Comptroller and Auditor-General 
of  India  or  his  nominee  and  any  expenditure  incurred  by  him  in  connection  with  such  audit  shall  be 
payable by the Corporation to the Comptroller and Auditor-General of India. 

(3)  The  Comptroller  and  Auditor-General  of  India  and  any  person  appointed  by  him  in  connection 
with  the  audit  of  the  accounts  of  a  Corporation  shall  have  the  same  rights,  privileges  and  authority  in 
connection with such audit as the Comptroller and Auditor-General of India has in connection with the 
audit  of  the  Government  accounts,  and,  in  particular,  shall  have  the  right  to  demand  the  production  of 
books, accounts, connected vouchers and other documents and papers and to inspect any of the offices of 
the Corporation. 

(4) The accounts of the Corporation as certified by the Comptroller and Auditor-General of India or 
any  person  appointed  by  him  in  this  behalf  together  with  the  audit  report  thereon  shall  be  forwarded 
annually  to  the  State  Government;  and  that  Government  shall  cause  the  same  to  be  laid  before  3[each 
House of Parliament].] 

CHAPTER V 

MISCELLANEOUS 

34. Directions by the State Government.—(1) The State Government may, after consultation with a 
Corporation established by such Government, give to the Corporation general instructions to be followed 
by the Corporation, and such instructions may include directions relating to the recruitment, conditions of 
service and training of its employees, wages to be paid to the employees, reserves to be maintained by it 
and disposal of its profits or stocks. 

(2) In the exercise of its powers and performance of its duties under this Act, the Corporation shall 
not depart from any general instructions issued under sub-section (1) except with the previous permission 
of the State Government. 

1. Subs. by Act 28 of 1959, s. 7, for “A Corporation may sanction” (w.e.f. 1-9-1959).  
2. Subs. by s. 8, ibid., for section 33 (w.e.f. 1-9-1959).  
3. Subs. by Act 71 of 1971, s. 7(a) and the First Schedule, for “the Legislature of the State” (w.e.f. 3-9-1971).  

14 

                                                           
35. Returns and reports.—(1) Every Corporation shall furnish to the State Government such returns, 
statistics,  accounts  and  other  information  with  respect  to  its  property  or  activities  or  in  regard  to  any 
proposed scheme as the State Government may from time to time require. 

(2)  Without  prejudice  to  the  provisions  of  sub-section  (1),  a  Corporation  shall,  as  soon  as  possible 
after  the  end  of  each  financial  year,  submit  to  the  1[State  Government]  a  report  on  the  exercise  and 
performance  by  it  of  its  powers  and  duties  under  this  Act  during  that  year  and  on  its  policy  and 
programme. 

2[(3)  The  State  Government  shall  cause  the  annual  report  referred  to  in  sub-section  (2)  to  be  laid 

before 3[each House of Parliament].] 

36.  Power  to  order  inquiries.—(1)  The  State  Government,  with  a  view  to  satisfy  itself  that  the 
powers and duties of a Corporation established by that Government are being exercised and performed 
properly, may, at any time, appoint any person or persons to make inquiries into all or any of the activities 
of the Corporation and to report to the State Government the result of such inquiries. 

(2)  The  Corporation  shall  give  to  the  person  or  persons  so  appointed  all  facilities  for  the  proper 
conduct  of  the  inquiries  and  shall  produce  before,  or  furnish  to,  the  person  or  persons  any  document, 
account or information in the possession of the Corporation which such person or persons demand for the 
purposes of the inquiries. 

37. Power to control a part of the undertaking of a Corporation.—(1) If on receipt of the report of 
any inquiry held under section 36 or otherwise, the State Government is satisfied that it is necessary so to 
do in the public interest, the State Government may, by notification in the Official Gazette, authorise any 
person  to  take  over  from  the  Corporation,  and  so  long  as  that  notification  is  in  force,  to  administer  in 
accordance with such directions as may be issued from time to time by the State Government such part of 
the undertaking of the Corporation as may be specified in the notification, and any person so authorised 
may, for the purpose of so administering the said part of the undertaking exercise all or any of the powers 
of the Corporation or of any officer of the Corporation under this Act, issue such directions as he thinks 
fit to the 4[officers or other employees] of the Corporation and employ any outside agency. 

(2) The State Government may by such notification direct that all charges and expenses incurred by 
the person so authorised together with such remuneration as the State Government may allow from time 
to time to such person shall be paid within such time as may be fixed by the State Government from the 
fund of the Corporation, and if the expenses are not so paid, the State Government may make an order 
directing the persons having the custody of that fund to pay to the person so authorised such expenses in 
priority  to  any  other  charges  against  such  fund  and  he  shall,  so  far  as  the  funds  to  the  credit  of  the 
Corporation admit, comply with the order of the State Government. 

5[(3) Every notification issued under this section together with a report on the circumstances leading 

to its issue shall be laid before 6[each House of Parliament], as soon as may be, after it is issued.] 

38.  Power  to  supersede  a  Corporation.—(1)  If  the  State  Government  is  of  opinion  that  a 
Corporation established by that Government is unable to perform, or has persistently made default in the 
performance of the duties imposed on it by or under the provisions of this Act or has exceeded or abused 
its  powers,  the  State  Government  may,  7***  by  notification  in  the  Official  Gazette,  supersede  the 
Corporation for such period as may be specified in the notification: 

Provided that before issuing a notification under this sub-section the State Government shall give a 
reasonable time to the Corporation to show cause why it should not be superseded and shall consider the 
explanation and objections, if any, of the Corporation. 

1. Subs. by Act 71 of 1971, s. 7(a) and the First Schedule, for “Central and the State Governments” (w.e.f. 3-9-1971).  
2. Ins. by Act 28 of 1959, s. 9 (w.e.f. 1-9-1959).  
3. Subs. by Act 71 of 1971, s. 7(a) and the First Schedule, for “the Legislature of the State” (w.e.f. 3-9-1971). 
4. Subs. by Act 63 of 1982, s. 16 and the Schedule, for “officers or servants” (w.e.f. 13-11-1982). 
5. Ins. by Act 28 of 1959, s. 10 (w.e.f. 1-19-1959).  
6. Subs. by Act 71 of 1971, s. 7(a) and the First Schedule, for “the Legislature of the State” (w.e.f. 3-9-1971).  
7.  The  words  “with  the  previous  approval  of  the  Central  Government,”  omitted  by  s.  7(a)  and  the  First  Schedule,  ibid.              

(w.e.f. 3-9-1971).  

15 

                                                           
(2) Upon the publication of a notification under sub-section (1) superseding a Corporation— 

(a)  all  the 1[Directors]  of  the  Corporation  shall,  as  from  the  date  of  supersession,  vacate  their 

offices as such a 1[Directors]; 

(b) all the powers and duties which may, by or under the provisions of this Act or of any other 
law,  be  exercised  or  performed  by  or  on  behalf  of  the  Corporation  shall,  during  the  period  of 
supersession,  be  exercised and  performed  by  such  person  or  persons  as  the  State  Government  may 
direct; 

(c) all property vested in the Corporation shall, during the period of supersession, vest in the State 

Government. 

(3)  On  the  expiration  of  the  period  of  supersession  specified  in  the  notification  issued  under             

sub-section (1), the State Government may— 

(a) extend the period of supersession for such further term as it may consider necessary; or 

(b) reconstitute the Corporation in the manner provided in section 5. 

39.  Liquidation  of  a  Corporation.—(1)  No  provision  of  any  law  relating  to  the  winding  up  of 
companies or corporations shall apply to a Corporation, and no Corporation shall be placed in liquidation 
save  by  order  of the  State Government  concerned  and  save  in  such  manner  as may  be  directed  by  that 
Government: 

Provided  that  no  such  order  shall  be  made  by  any  State  Government  except  with  the  previous 

approval of the Central Government. 

(2)  In  the  event  of  a  Corporation  being  placed  in  liquidation,  the  assets  of  the  Corporation,  after 
meeting the liabilities, if any, shall be divided among the  2[State Government] and such other parties, if 
any, as may have subscribed to the capital in proportion to the contribution made by each of them to the 
total capital of the Corporation. 

40.  Compensation  for  acquisition  of  road  transport  undertakings.—Whenever  a  Corporation 
acquires under this Act the whole or any part of any undertaking, there shall be paid by the Corporation 
compensation  the  amount  of  which  shall  be  determined  in  the  manner  and  in  accordance  with  the 
procedure hereinafter set out, that is to say,— 

(a) where the amount of compensation can be fixed by agreement, it shall be paid in accordance 

with such agreement; 

(b)  where  no  such  agreement  can  be  reached,  the  amount  shall  be  determined  by  an  arbitral 
Tribunal  consisting  of  one  nominee  of  the  Corporation,  one  nominee  of  the  person  to  be 
compensated, and a Chairman to be nominated by the Chief Justice of the 3[High Court of Delhi]; 

(c) an appeal shall  4[lie to the High Court of Delhi] against the decision of the Tribunal and the 

5[order of that High Court] on such appeal shall be final. 

41.  [Corporation  to  be  deemed  to  be  a  local  authority  and  provision  as  to  third  party                         
risks].—Omitted  by  the  Road  Transport  Corporations  (Amendment)  Act,  1959  (28  of  1959),                            
s. 11 (w.e.f. 1-9-1959). 

42. Power of entry.—Whenever it is necessary for a Corporation to carry out any of its works or to 
make any survey, examination or investigation, preliminary or incidental to the exercise of powers or the 
performance  of  duties  by  the  Corporation  under  this  Act,  any  6[officer  or  other  employee]  of  the 
Corporation generally or specially empowered by the Corporation may, with the previous permission of 

1. Subs. by Act 63 of 1982, s. 16 and the Schedule, for “members” (w.e.f. 13-11-1982).  
2. Subs. by Act 71 of 1971, s. 7(a) and the First Schedule, for “Central and the State Government” (w.e.f. 3-9-1971).  
3. Subs. by s. 7(a) and the First Schedule, ibid., for “High Court exercising jurisdiction in relation to the State concerned” 

(w.e.f. 3-9-1971).  

4. Subs. by s. 7(a) and the First Schedule, ibid., for “lie to the High Court” (w.e.f. 3-9-1971).  
5. Subs. by s. 7(a) and the First Schedule, ibid., for “order of the High Court” (w.e.f. 3-9-1971). 
6. Subs. by Act 63 of 1982, s. 16 and the Schedule, for “officer or servant” (w.e.f. 13-11-1982). 

16 

                                                           
the District Magistrate, enter upon any land or premises between sunrise and sunset, after giving reason-
able notice of the intention to make such entry to the owner or occupier of such land or premises, and at 
any  other  time,  with  the  consent  in  writing  of  the  owner  of  occupier  of  such  land  or  premises,  for  the 
purpose of the carrying out of such works or the making of such survey, examination or investigation. 

43.  1[Directors],  2[Officers  and  other  employees]  of  a  Corporation  to  be  public  servants.—All 
1[Directors] of a Corporation, and all 2[officers and other employees] of a Corporation, whether appointed 
by  the  State  Government  or  the  Corporation,  shall  be  deemed,  when  acting  or  purporting  to  act  in 
pursuance  of  any  of  the  provisions  of  this  Act  or  of  any  other  law,  to  be  public  servants  within  the 
meaning of section 21 of the Indian Penal Code (45 of 1860). 

44. Power to make rules.—(1) The State Government may, by notification in the Official Gazette, 

make rules to give effect to the provisions of this Act. 

(2)  In  particular,  and  without  prejudice  to  the  generality  of  the  foregoing  power,  such  rules  may 

provide for all or any of the following matters, namely:— 

3[(a) the conditions and manner of appointment of Directors of a Corporation, the representation 
in the Board of the Central and State Governments, and where shares are issued to other parties under 
sub-section (3) of section 23 of such shareholders and generally all matters relating to the constitution 
of the Board;] 

4[(b) remuneration, allowances or fees paid to the Directors of the Corporation or other persons 

associated with the Board under section 10;] 

(c)  the  term  of  office  of,  the  manner  of  filling  casual  vacancies  among  5[Directors]  of  the 

Corporation; 

(d) the number of 5[Directors] necessary to constitute a quorum at a meeting of the 6[Board]; 
(e) the conditions of appointment and service and the scales of pay of the  7[Managing Director, 

the  Chief  Accounts  Officer,  the  Financial  Adviser  or,  as  the  case  may  be,  the  Chief  Accounts                
Officer-cum-Financial Adviser] of the Corporation; 

(f) the number and term of office of, the allowances to be paid to, the procedure to be followed 

by, and the manner of filling casual vacancies among, members of an Advisory Council; 

8[(ff)  the  procedure  in  accordance  with  which  any  stores  may  be  declared  obsolete  under                 

sub-section (2) of section 19;] 

(g) the manner in which the shares of the Corporation shall be allotted, transferred or redeemed; 

(h) the manner in which the net profits of the Corporation shall be utilised; 

(i) the date by which, and the form in which, the budget shall be prepared and submitted in each 

year under sub-section (1) of section 32; 

9[(j) the form in which the annual statement of accounts shall be prepared;] 
10* 

* 

* 

* 

* 

(l) the form in which the returns, statistics or reports shall be submitted under section 35; 

(m) the procedure to be followed by an arbitral Tribunal under section 40; 

1. Subs. by Act 63 of 1982, s. 16 and the Schedule, for “members” (w.e.f. 13-11-1982).  
2. Subs. by s. 16 and the Schedule, ibid., for “officers and servants” (w.e.f. 13-11-1982). 
3. Subs. by s. 16 and the Schedule, ibid., for clause (a) (w.e.f. 13-11-1982).  
4. Subs. by s. 16 and the Schedule, ibid., for clause (b) (w.e.f. 13-11-1982).   
5. Subs. by s. 16 and the Schedule, ibid., for “members” (w.e.f. 13-11-1982).  
6. Subs. by s. 16 and the Schedule, ibid., for “Corporation” (w.e.f. 13-11-1982). 
7. Subs. by s. 16 and the Schedule, ibid., for “Chief Executive Officer or General Manager and the Chief Accounts Officer” 

(w.e.f. 13-11-1982). 

8. Ins. by s. 16 and the Schedule, ibid. (w.e.f. 13-11-1982).  
9. Subs. by Act 28 of 1959, s. 12, for clause (j) (w.e.f. 1-9-1959).  
10. Omitted by s. 12, ibid. (w.e.f. 1-9-1959). 

17 

 
 
 
 
 
 
 
                                                           
1[(mm) the service of notices and orders under this Act;] 

(n) any other matter which has to be, or may be, prescribed. 

45. Power to make regulations.—(1) A Corporation may with the previous sanction of  2[the State 
Government and by notification in the Official Gazette], make regulations, not inconsistent with this Act 
and the rules made thereunder for the administration of the affairs of the Corporation. 

(2) In particular and without prejudice to the generality of the foregoing power, such regulations may 

provide for all or any of the following matters, namely:— 

(a) the manner in which, and the purposes for which, persons may be associated with the 3[Board] 

3[Board] under section 10; 

(b) the time and place of meetings of a the 3[Board] and the procedure to be followed in regard to 

transaction of business at such meetings; 

(c)  the  conditions  of  appointment  and  service  and  the  scales  of  pay  of  officers  and  4[other 
employees of the Corporation other than the Managing Director, the Chief Accounts Officer and the 
Financial Adviser or, as the case may be, the Chief Accounts Officer-cum-Financial Adviser]; 

5[(d) the issue of passes to the employees of the Corporation and other persons under section 19; 

(e) the grant of refund in respect of unused tickets and concessional passes under section 19.] 

6[(f) the period after the expiration of which unclaimed articles or goods may be sold by public 

auction; 

(g)  the  regulation  of  the  carriage  of  passengers  and  goods  in  the  road  transport  services  of  the 

Corporation.] 

7[45A.  Every  rule  and  regulation  to  be  laid  before  State  Legislature.—Every  rule  and  every 
regulation  made  under  this  Act  shall  be  laid,  as  soon  as  may  be  after  it  is  made,  before  the  State 
Legislature.] 

46.  Penalty for  breach  of  rules.—The  State  Government  may,  by  rule,  provide  that  the  breach of 
any rules made by it under section 44 6[or any regulations made by a Corporation under section 45] shall 
be punishable with fine which may extend to five hundred rupees, and when the breach is a continuing 
one, with a further fine not exceeding twenty rupees for every day after the date of the first conviction 
during which the offender is proved to have persisted in the offence. 

47.  Special  provisions  relating  to  Bombay.—(1)  The  body  known  as  the  Bombay  State  Road 
Transport  Corporation  and  the  Board  thereof,  referred  to  in  the  notification  of  the  Government  of 
Bombay,  No.  1780/5,  dated  the  16th  November,  1949  (hereinafter  referred  to  as  “the  existing 
corporation”  and  “Board”  respectively)  shall,  notwithstanding  any  defect  in,  or  invalidity  of,  the 
enactment or order under which they were constituted, be deemed for all purposes to have been validly 
constituted as if all the provisions of the said notification had been included and enacted in this section 
and this section had been in force continuously on and from the said date, and accordingly— 

(a)  all  action  by,  and  all  transactions  with,  the  existing  Corporation  or  Board,  including  any 
action or transaction by which any property, asset or right was acquired or any liability or obligation, 
whether by contract or otherwise, was incurred, shall be deemed to have been validly and lawfully 
taken or done; and 

1. Ins. by Act 71 of 1971, s. 7(a) and the First Schedule (w.e.f. 3-9-1971). 
2. Subs. by Act 4 of 2005, s. 2 and the Schedule, for “the State Government” (w.e.f. 11-1-2005).  
3. Subs. by Act 63 of 1982, s. 16 and the Schedule, for “Corporation” (w.e.f. 13-11-1982).  
4. Subs. by s. 16 and the Schedule, ibid., for “servants of the Corporation, other than the Chief Executive Officer or General 

General Manager and the Chief Accounts Officer” ( w.e.f. 13-11-1982).  

5. Ins. by Act 28 of 1959, s. 13 (w.e.f. 1-9-1959).  
6. Ins. by Act 71 of 1971, s. 7(a) and the First Schedule (w.e.f. 3-9-1971).  
7. Ins. by Act 4 of 2005, s. 2 and the Schedule (w.e.f. 11-1-2005)  

18 

                                                           
(b) no suit, prosecution or other legal proceeding shall lie against the Government of Bombay or 
any member of the Board or any officer or servant of the existing Corporation in respect of any action 
taken by, or in relation to the setting up of, the existing Corporation or Board merely on the ground of 
any defect in, or invalidity of, the enactment or order under which the existing Corporation or Board 
was constituted. 

(2) On the establishment of a Corporation under section 3 in the State of Bombay (hereinafter referred 

to as “the new Corporation”),— 

(a)  the  existing  Corporation  and  Board  shall  be  deemed  to  be  dissolved  and  shall  cease  to 

function; 

(b) all property and assets vesting in the existing Corporation shall vest in the new Corporation; 

(c)  all  rights,  liabilities  and  obligations  of  the  existing  Corporation,  whether  arising  out  of  any 
contract  or  otherwise,  shall  be  the  rights,  liabilities  and  obligations,  respectively,  of  the  new 
Corporation; and 

(d) all licences and permits granted to, all contracts made with, and all instruments executed on 
behalf of, the existing Corporation or Board shall be deemed to have been granted to, made with, or 
executed on behalf, of, the new Corporation and shall have effect accordingly. 

1[47A. Special provision for reconstitution or dissolution of certain Corporations.—(1) Where on 
account of the reorganisation of States under the States Reorganisation Act, 1956 (37 of 1956), 2[or any 
other enactment relating to reorganisation of States, the whole or any part of a State in respect of which a 
Corporation was, immediately before the day on which the reorganisation takes place,] functioning and 
operating, is transferred on that day to another State and by reason of such transfer, it appears to the State 
Government necessary or expedient that the Corporation should be reconstituted or re-organised in any 
manner  whatsoever  or  that  it  should  be  dissolved,  the  State  Government  may  frame  a  scheme  for  the 
reconstitution,  reorganisation  or  dissolution  of  the  Corporation  including  proposals  regarding  the  for-
mation  of  new  Corporations  the  amalgamation  of  the  Corporation  with  any  other  Corporation,  body 
corporate or a commercial undertaking of another State Government, the transfer of the assets, rights and 
liabilities of the Corporation in whole or in part to any other Corporation, body corporate or a commercial 
undertaking  of  another  State  Government,  and  the  transfer  or  re-employment  of  any  workmen  of  the 
Corporation, and the State Government may forward the scheme to the Central Government for approval. 

Explanation.—For the purpose of framing any scheme under this sub-section, “State Government”,— 

3[(i) 

in  relation 

to 

the  Bombay  State  Road  Transport  Corporation,  shall  mean 

the                       

Government of the State of Maharashtra or of Gujarat as formed under the Bombay Reorganisation 
Act, 1960 (11 of 1960);] 

(ii) in relation to the PEPSU Road Transport Corporation, shall mean the Government of the State 

of Punjab, as formed under the provisions of the States Reorganisation Act, 1956 (37 of 1956); 

4[(iii) in relation to the Assam State Road Transport Corporation, shall mean the Government of 
the State of Assam or of Meghalaya as formed under the North-Eastern Areas (Reorganisation) Act, 
1971 (81 of 1971).] 

(2)  On  receipt  of  any  such  scheme,  the  Central  Government  may,  after  consultation  with  the  State 
Governments concerned, approve the scheme with or without modifications and for the purpose of giving 
effect  to  the  approved  scheme,  the  Central  Government  may,  from  time  to  time,  make  such  order  in 
relation  thereto  as  it  thinks  fit  and  every  order  so  made  shall  have  effect  notwithstanding  anything 
contained in this Act. 

1. Ins. by Act 87 of 1956, s. 2 (w.e.f. 28-12-1956).  
2. Subs. by Act 11 of 1960, s. 71, for “the whole or any part of a State in respect of which a Corporation was, immediately 

before the 1st day of November, 1956,” (w.e.f. 25-4-1960).  

3. Subs. by s. 71, ibid., for clause (i) (w.e.f. 25-4-1960).  
4. Ins. by Act 81 of 1971, s. 73 (w.e.f. 21-1-1972).  

19 

                                                           
(3)  Any  order  made  under  sub-section  (2)  may  provide  for  all  or  any  of  the  following  matters, 

namely:— 

(a) the dissolution of the Corporation, notwithstanding anything contained in section 39; 

(b) the reconstitution or reorganisation, in any manner whatsoever, of the Corporation including 

the establishment, where necessary, of more than one Corporation in any State; 

(c)  the  amalgamation  of  two  or  more  Corporations, or  of  one  Corporation  with  any  other  body 

corporate or a commercial undertaking of any other State Government; 

(d) the extension of the area for which the Corporation is established, or the exclusion of any area 

therefrom; 

(e)  the  transfer,  in  whole  or  in  part,  of  the  assets,  rights  and  liabilities  of  the  Corporation 
including the transfer of any licences or permits granted to the Corporation, to any other Corporation, 
body  corporate  or  a  commercial  undertaking  of  any  other  State  Government,  and  the  terms  and 
conditions of such transfer; 

(f) 

the 

transfer  or  re-employment  of  any  workmen  of 

the  Corporation 

to,  or  by,                          

any  such  transferee,  and,  subject  to  the  provisions  of  section  111  of  the  States  Reorganisation                 
Act, 1956 (37 of 1956), 1[or any other enactment relating to reorganisation of States], the terms and 
conditions of service applicable to such workmen after such transfer or re-employment; 

(g) such incidental, consequential and supplemental matters as may be necessary to give effect to 

the approved scheme. 

(4)  Where  an  order  is  made  under  this  section  transferring  the  assets,  rights  and  liabilities  of  any 
Corporation, then, by virtue of that order, such assets, rights and liabilities of the Corporation shall vest 
in, and be the assets, rights and liabilities of, the transferee.] 

1[48.  Transitional  provision  relating  to  Bombay  State  Road  Transport  Corporation.—
Notwithstanding anything contained in section 47A, it shall be lawful for the Government of the State of 
Bombay  to  frame  a  scheme  under  sub-section  (1)  thereof  and  forward  the  same  to  the  Central 
Government  before  the  1st  day  of  May,  1960,  and  in  such  a  case,  the  power  conferred  on  the  Central 
Government to make an order under sub-section (2) thereof may be exercised before that day but no order 
so made shall take effect till that day.] 

2[CHAPTER VI 

SPECIAL PROVISIONS APPLICABLE TO THE UNION TERRITORY OF DELHI 

49. Prosecution and cognizance of offences.—(1) No court shall proceed to the trial of any offence 
made punishable by or under this Act except on the complaint of, or on an information received from, the 
General Manager of the new Corporation or a person authorised by him by general or special order in this 
behalf in writing. 

(2) All offences against this Act or any rule or regulation made thereunder, or any bye-law continued 
thereunder,  whether  committed  within  or  without  the  limits  of  the  Union  territory  of  Delhi,  shall  be 
cognizable by a Magistrate. 

50. Appointment of Magistrates.—(1) The State Government may appoint one or more magistrates 
of  the  first  or  second  class  for  the  trial  of  offences  against  this  Act  or  any  rule  or  regulation  made 
thereunder  or  any  bye-law  continued  thereunder  and  may  prescribe  the  time  and  place  at  which  such 
magistrate or magistrates shall sit for the despatch of business. 

(2) Such magistrates and the members of their staff shall be paid such salary, pension, leave and other 

allowances as may, from time to time, be fixed by the State Government. 

1. Ins. by Act 11 of 1960, s. 71 (w.e.f. 25-4-1960).  
2 Ins. by Act 71 of 1971, s. 7(a) and the Schedule (w.e.f. 3-9-1971). 

20 

                                                           
(3) The new Corporation shall out of its fund, pay to the State Government the amounts of the salary, 
pension,  leave  and  other  allowances  as  fixed  under  sub-section  (2)  together  with  all  other  incidental 
charges in connection with the establishments of the said magistrates. 

(4) Such Magistrates shall have jurisdiction over the whole of the Union territory of Delhi. 

(5) For the purposes of the Code of Criminal Procedure, 1898 (5 of 1898), all magistrates appointed 

under this section shall be deemed to be magistrates appointed under section 12 of that Code. 

51. Composition of offences.—(1) The General Manager of the new Corporation or any officer or 
other  employee  specially  empowered  by  him  in  this  behalf  in  writing  may,  either  before  or  after  the 
institution of the proceedings compound any offence made punishable by, or under this Act. 

(2) Where an offence has been compounded, the offender, if in custody, shall be discharged and no 

further proceedings shall be taken against him in respect of the offence so compounded. 

52. Limitation of time for prosecution.—No person shall be liable to punishment for any  offence 
against this Act or any rule or regulation made thereunder or any bye-law continued thereunder, unless 
complaint of such offence is made before a Magistrate within six months next after,— 

(a) the date of the commission of such offence, or 

(b) the date on which the commission or existence of such offence was first brought to the notice 

of the complainant. 

53. Power of magistrate to hear cases in absence of accused when summoned to appear.—If any 
person summoned to appear before a magistrate to answer a charge of an offence against this Act or any 
rule or regulation made thereunder, or any bye-law continued thereunder, fails to appear at the time and 
place  mentioned  in  the  summons,  or  on  any  date  to  which  the  hearing  of  the  case  is  adjourned,  the 
magistrate may hear and determine the case in his absence, if— 

(a) service of the summons on such person is proved to his satisfaction, and 

(b) no sufficient cause is shown for the non-appearance of such person. 

21 

